Preschool president Bernie Carne said there was confusion over the future of the kinder, with some people believing it had already closed or was winding down its services.

She said the preschool, in Frankston-Flinders Road, would offer full classes until it moved, possibly in 2012, and the committee had determined not to move to a temporary centre.

"We are still an active preschool with a terrific program and facilities," she said. "We love it here, but we do support the move."

Next year the kinder will begin offering longer programs for fouryearolds, increasing to 15 hours a week in 2013, in line with new government regulations.

The shire's manager of child, youth and family care, Robin Adams, confirmed the council was negotiating to sell the site to Aldi, which is building a supermarket on the vacant block next to the kinder.

Proceeds from the sale, expected to be between $750,000 and $1million, would be used to build a new preschool at the primary school in Eramosa Road East.

He said maintenance on the 50-year-old building had become too costly and there were safety concerns due to increasing traffic on Frankston-Flinders Road.

A group of elderly residents, led by Somerville historian Leila Shaw, has objected to the sell-off, arguing it is not the shire's to sell.

The site was gifted to the community by Ms Shaw's father, TW Brunning, after World War II. It was originally a maternal and child health clinic, which the Somerville community decided was a fitting memorial to the men and women who had served in the war, and was built with community donations.

Mrs Shaw and a group of residents met Mr Adams last week and are collecting signatures on a petition to put to the shire expressing their concerns. Mr Adams said he had asked for their views on an appropriate war memorial to replace the kinder. "I asked them to write to the council and be specific about what they want."